What would most effectively describe the risk of incorrect acceptance in terms of substantive audit testing?
AHe applies random sampling on data which is inaccurate and inconsistent
BThe auditor has ascertained that the balance is materially correct when in actual fact it is not
CThe auditor concludes the balance is materially misstated when in actual fact is not
DThe auditor has rejected an item from sample which was not supported by documentary evidence
Correct answer
B. The auditor has ascertained that the balance is materially correct when in actual fact it is not
Explanation
The auditor has ascertained that the balance is materially correct when in actual fact it is not is the correct answer. Review the question and compare it with the other choices to remember this fact for future exams.